Ankara: The Turkish central bank governor slammed ratings agency Standard & Poor’s on Tuesday for downgrading Turkey’s sovereign debt following the July 15 failed coup, calling the decision “hasty”.
Speaking at a news conference to announce the bank’s quarterly inflation report in Ankara, Murat Cetinkaya said it was still too early to assess the impact of the abortive putsch on the Turkish economy.
“To be able to understand the impact of the incident we have recently experienced in Turkey ... a sufficient amount of time needs to have passed and a sufficient amount of data and observations need to be collected,” Cetinkaya said.
“We think it is still too early for this. I want to say that we, as the central bank, find the decision recently taken by a rating agency as hasty,” he added.
Last week Standard & Poor’s cut Turkey’s credit rating deeper into junk territory, saying its political landscape had further fragmented since the attempted coup, when a faction in the military tried to overthrow the government. It soon crumbled as large numbers of Turks rallied in support of democracy in response to an appeal from President Tayyip Erdogan.
S&P also said political polarisation had further eroded institutional checks and balances in Turkey, a reference to a wide-ranging crackdown on suspected coup plotters and their supporters in the judiciary, the military, the educational sector and the civil service.
Cetinkaya said the bank’s midpoint forecast for year-end inflation was 7.5 per cent for 2016 and 6 per cent for 2017, both unchanged from the previous report in April.
Cetinkaya also said at the presentation in Ankara that the bank’s liquidity measures, taken in the wake of the attempted putsch, helped to limit volatility in markets.
He said the monetary policy stance would depend on the inflation outlook in the coming period.
